Automation has proved to be a significant benefit for business, managing processes in minutes that used to take days or even weeks to complete. Automation is particularly useful in bookkeeping and accounting, where software solutions can be the difference between a labor-intensive manual endeavor and a click or two of the mouse. For example, instead of physically collecting, cataloging, and paying invoices, you can use software to handle these laborious tasks for you in next to no time.
For non-profit organizations, this kind of automation can make an even bigger impact, especially in the realm of payments. With a small allocation for overhead expenses and a strict oversight process, properly handling, organizing, and signing off on invoices can be an enormous undertaking, requiring an unfortunately large investment of both time and money to manage. But why spend that kind of cash when you don’t have to?
Automating the payment process has changed the face of business, giving organizations with tight budgets and even tighter procedures room to breathe. With a wealth of benefits to offer, automation is an absolute necessity for not-for-profits.
Benefits from accounts payable automation
- Saves Time
- Saves Money
- Facilitates Easy Sign-Offs
- Ensures Proper Payments
The time savings benefits of automation are among the most desirable. Instead of appointing a member of your accounting team to spend all day, every day absorbed in tracking and organizing invoices, writing checks, and reconciling books; you can let a computer do the heavy lifting.
An automated process shaves countless hours off of invoice processing, providing a pain-free conduit through which to enter data, create payments, and track due dates. With accounting system integration into platforms such as QBO and Xero, it’s even possible to create journal entries and schedule payments in a few simple steps. Set-up can be straightforward as well, making implementation easy even for NGOs with limited resources.
Why pay a professional when a low-cost software product can take the reins?
It’s no secret that most NGOs are operating with close margins and a low threshold for back-office costs, so any opportunity to save money is a major benefit. AP and AR automation can be quite affordable, allowing for comprehensive services at a single reduced rate. Affordable rates diminish the need for human capital; after all, there’s no need to hire a full-time employee to sort through receipts when a cost-effective alternative can take over instead.
While an automated platform still needs a little human interference, the time-saving potential gives you the freedom to save thousands over the cost of a salary and benefits. There are also opportunities to outsource some of these processes to a bookkeeping service provider such as Enkel.
Facilitates Easy Sign-Offs
Unlike for-profit businesses that can be more relaxed with invoice sign-off processes, NGOs must follow strict standards that often include multiple layers of approval. Board members have final authority, and a signature – or, in many cases, double signatures – is required before an invoice can be completed. Because board members often have other jobs and obligations in addition to supporting an NGO, acquiring signatures may be far more arduous than it sounds.
Online payment automation platforms take the labor out of obtaining sign-offs, allowing board members to approve invoices from anywhere at any time. With digital signature functions, it’s possible to sign checks and make payments in real time, avoiding the costs and delays associated with physical checks and courier services.
Ensures proper payments
No human is perfect, and even the best members of a team will make mistakes from time to time. With any luck, internal controls are strong enough to stop serious issues, but sometimes, things slip through the cracks.
How to automate the accounts payable process
1. Identify which processes to automate
Physically collecting, cataloging and paying invoices all take time and could be automated with the right software solution.
2. Research software solutions
With many options to choose from, take time to determine which solution saves you the most time, money, and integrates best with your current accounting systems to make the process seamless.
3. Allocate budget for the solution
There are many software solutions that allow free trials, or work on a free + paid for additional features model.
Any accounts payable automation you choose will require investment, so allocate resources to give your solution the best chance at success.
4. Appoint someone to champion the automation process
While accounts payable automation will save you plenty of time and money in the long term, you’ll need someone to oversee the processes a little more closely at first to ensure everything is running smoothly and to fix any initial mistakes.
5. Implement the software
The time it takes to onboard a new software solution will depend on the complexity of your current AP process, but there are self-serve guides or customer support teams typically available to help you.
Once implemented and all your accounts payable inputs have been added, you are ready to start automating your accounts payable process.
An automated AP/AR solution can be your safety net, ensuring accurate invoice tracking and data entry without the risk of a few fumbled figures. When invoices are delivered electronically and compared against bookkeeping entries, amounts are far more likely to be correct. A typo here or there gets corrected immediately and no longer results in incorrect, late, or missed deadlines, guaranteeing proper and timely payments. Further, built-in fund accounting tools can categorize invoices correctly for seamless approval.
Ready to bring your not-for-profit into the 21st century? Get in touch today to see how Plooto can help you manage your payments.
Dene Paquin is the Marketing Manager at Enkel Backoffice Solutions, a Vancouver based accounting firm that provides day-to-day bookkeeping services for small and medium-sized businesses throughout Canada. Enkel strives to provide fellow entrepreneurs with a better system for managing their bookkeeping, cash flow and financial data, so they can focus on growing their business.